Happilo’s topline contracts 15% to Rs 280 Cr in FY25, cuts losses by 93%

Direct-to-consumer (D2C) healthy snacking brand Happilo saw its operating scale fall 15% in the fiscal year ending March 2025. However, the company reduced its losses by 93% and brought them down to under Rs 10 crore after reducing advertising and other miscellaneous costs.

Happilo’s revenue from operations fell to Rs 280 crore in FY25 from Rs 329 crore in FY24, according to the annual financial statements of Happy International Pvt Ltd, its parent entity, filed with the Registrar of Companies.

Founded in 2016, Happilo sells a range of snacks such as dry fruits, trail mixes, nut protein bars, dates, and muesli through online platforms and its omnichannel network. The sale of these products remained its only source of revenue in FY25.

The company also earned Rs 2.5 crore from non-operating sources, which took its total income to Rs 282.5 crore in FY25.

For the D2C brand, the procurement cost accounted for 73% of the total expenditure. In the line of scale,this cost decreased 17% to Rs 212.4 crore in the fiscal year ending March 2025 from Rs 257 crore in FY24. Its employee benefit expenses also declined 34% to Rs 15.5 crore in the last fiscal.

Meanwhile, Happilo cut its advertising and promotional expenses by 59% to Rs 28.2 crore in FY25 from Rs 69.4 crore in FY24. The company was also the ‘Snacking Partner’ of Royal Challengers Bangalore during the Indian Premier League 2024.

The company incurred Rs 7.6 crore on transportation during the year. Other overheads, including travelling, legal and professional, and undisclosed miscellaneous expenses, pushed Happilo’s total expenditure to Rs 292 crore in FY25 from Rs 467.7 crore in FY24. This represented a 38% year-on-year decline, as undisclosed miscellaneous expenses fell sharply to Rs 6.2 crore in FY25 from Rs 46.2 crore in FY24.

Despite a 10% decline in revenue, the cost control measurement helped the Bengaluru-based firm to reduce its losses by 93% to Rs 9.5 crore in FY25 from Rs 136.6 crore in FY24.

Importantly, Happilo turned EBITDA positive with Rs 3 crore while its ROCE and EBITDA margin improved to -11.54% and 0.89% respectively. On a unit level, the company spent Rs 1.04 to earn a single unit of operating revenue in FY25.

Happilo has raised around $38.5 million across two funding rounds. Its latest round came in February 2022, when Motilal Oswal Private Equity invested $25 million. Prior to that, it secured $13.5 million from A91 Partners in February 2021.

Happilo’s travails will not surprise anyone who has an exposure to the market it operates in. With low entry barriers and intense competition, brand premiums have been tough to build, and Happilo, after a promising run to Rs 200 crore, is realising that. The market is expanding, but not margins as more and more players seek a share of the pie. Rotating cash faster, even at the cost of margins is the preferred route for most, as while not perishable in weeks, the product mix does need to be handled so that it doesn’t sit with the seller for too long. Differentiation or consumer education is weak, leaving a gap for niche players to exploit, but only upto a point before others wise up.  Volatile product procurement prices wouldn’t have helped in a category where significant produce is imported. The good news is that with the India-US trade treaty, and other treaties as well, key nut imports will become cheaper and more easy to import, helping support market expansion well into the foreseeable future. Happilo has a task on its hands, as investor interest is likely to be low without a convincing differentiator, rather than the premium channel approach that worked for it until recently.